Gold fell back from the 50 DMA at 1329.00 and has spent the last couple of trading sessions consolidating around 1320.00 and the 100 DMA at 1321.00. Support can be found at last week’s lows of 1314.50, followed by 1311.14 and the 200 DMA at 1304.35. The low point between the double top is at 1302.40 and a loss of this level technically sets up a test of the 1240.00 area. However, there is strong support at 1300.00, with the falling trend line support also pointing to 1290.00. The long-term red supportive trend line at 1280.00 could also prevent a sell-off.
Should the price bottom and turn higher from current levels, the 1333.60 level has been used as a median area between the highs and lows. A break above potentially puts gold bulls back in control, but many of the weaker moves higher have topped out around 1341.00, with stronger moves making it above 1350.00 but failing ahead of 1365.30. A break above this level could see a rapid move to 1375.00, followed by 1390.00 and even 1400.00.
EURGBP
This currency pair has broken out higher above its combined 100 and 200 DMA at 0.87978. Friday’s candle is eye-catching and presents long positions with a tailwind to drive price higher. The candle also broke above an inverse head and shoulders pattern neckline at 0.87917, and it is possible that this will lead to higher levels, with a target of 0.89500. This would result in a move above the red trend line at 0.89310 and target a retest of recent highs above 0.90000.
Support can be found at the 50-period DMA at 0.87665 and the 0.87574 area. The next area of support comes at 0.87162 and extends down to 0.86900. A break below the recent lows around 0.86275 would target the falling trend line support at 0.85785, containing the red and blue trend lines today.
